BHP is seeking to work with the steel sector and other industries, and will set public targets for action on CO2 emissions. Consumers of BHP's products, such as iron ore, generate almost 40 times more emissions than the company's own mining operations.
BHP Group, the world's largest mining company, has pledged US$ 400 million in funding for research to help address carbon emissions caused by its customers, such as steel mills.
The announcement by CEO Andrew Mackenzie means that BHP is breaking ranks with many of its peers by actively working to reduce pollution from the industries that buy its minerals.
The company will accelerate investments over the next five years in areas including the development of carbon capture and storage technology, under a broader drive to help customers mitigate their contribution to climate change, Mackenzie says.
«Those who enjoy the benefits of our products should be able to do so with less and less impact,» Mackenzie said in a speech in London on Tuesday. «We must take on a product stewardship role for all emissions in our value chain.».
BHP is seeking to work with the steel sector and other industries, and will set public targets for action on its customers' emissions, Mackenzie said. Consumers of BHP products, such as iron ore, generate almost 40 times more emissions than the company's own mining operations.
Mining companies, along with oil producers and the cement sector, are under pressure from some investor groups over climate issues and are setting stricter targets for so-called Scope 1 emissions - the direct carbon dioxide emissions from their operations - and Scope 2 emissions - related to the electricity the companies buy for their projects.
However, the larger mining companies disagree on how to address the broader problem of Scope 3 emissions: those generated by customers as a result of using the products they sell.
While rival Rio Tinto Group has urged steelmakers and governments to take steps to reduce emissions, the company insists it should not be responsible for implementing technologies or setting targets to curb discharges.
«We cannot provide hard targets for action that are beyond our control,» Rio president Simon Thompson told an annual meeting in May in Perth.
Executive pay
Global industry accounts for more than one-fifth of all greenhouse gas emissions, and the steel sector is among the biggest polluters, according to BloombergNEF.
BHP estimates that its products generated Scope 3 emissions of more than 590 million tons of carbon dioxide equivalent in the 12 months to July last year, compared with combined Scope 1 and Scope 2 discharges of about 16.5 million tons. Rio's 2018 Scope 3 emissions totaled 536 million tons, according to a February filing.
In addition to setting new targets, Melbourne-based BHP intends to link executive pay more closely to action to reduce emissions, Mackenzie said.
BHP will also examine options to sell its remaining thermal coal assets, people familiar with the matter said earlier this month.
«The evidence is abundant: global warming is indisputable,» Mackenzie said Tuesday. «The planet will survive. Many species may not.».
